GAO: Customs modernization still problematic

The Homeland Security Department has spent $1 billion on an import and export processing system, but its deployment has met with delays and defects, a new Government Accountability Office report said today.

The Automated Commercial Environment, which ultimately is expected to cost $3.3 billion, is in the fourth phase, known as Release 4, of 11 scheduled staged releases in which its features are being tested, GAO said.

The commercial environment's goal is to facilitate trade through better management, while also strengthening border security by quickly identifying transactions that could pose possible threats.

The contract was awarded in April 2001 to IBM Corp. and a team that includes Lockheed Martin Corp.

So far, the program's expenditure plan "largely satisfies the legislative conditions imposed by the Congress," GAO said. "In addition, some of the recommendations that GAO has previously made to strengthen ACE management have been addressed," and the Homeland Security Department "has committed to addressing those that remain," the report added. "However, much remains to be done before these recommendations are fully implemented."

The Customs and Border Patrol's Modernization Office, which manages the program, has met a goal of successfully executing 99.9 percent of all transactions through the program, with the exception of 11 days since Feb. 1, GAO said.

Other management goals have fallen short. As of November 2004, the modernization office had activated only 311 importer user accounts for the new system, about one-half of the intended goal of 600 such accounts, the report said.

Furthermore, "Release 3 testing and pilot activities were delayed and have produced system defect trends that have raised questions about decisions to pass key milestones and about the state of system maturity," according to GAO.

Release 4 also has been plagued by defects. "The defect profile for Release 4 shows improvements in resolving defects, but critical and severe defects remain in the operational system," GAO said. Specifically, as of Nov. 30, 2004, which was about one-and-a-half weeks from deployment of the Release 4 pilot period, 33 material defects were present, GAO said.

GAO said DHS officials "agreed with our findings concerning progress in addressing our pervious recommendations. In addition, the department agreed with the new recommendations we are making in this report and described actions that it plans to take to enhance accountability for the program."